The National Insurance Commission (NIC) has indefinitely suspended plans to increase motor insurance tariffs by 400 percent to allow for broad consultation with stakeholders.
The Ghana Insurers Association, in consultation with the General Insurance Council and other stakeholders on Monday 8th June, 2015, announced that it had increased third party motor insurance tariffs.
Under the new policy, owners of private cars, who used to pay GH¢67 per annum, are to pay a total premium of GH¢471.
Taxi cabs owners are to pay GH¢576 while those with hiring cars, mini and maxi buses are to pay GH¢586.
Owners of motorcycles are to pay GH¢256 per annum while owners of ambulance/hearse are to pay GH¢483 henceforth. Owners of articulated trucks and tankers are to pay GH¢821.
According to the insurance bodies, they undertook a critical appraisal of the motor insurance portfolio and the huge and ever increasing liabilities assumed by underwriter both under the third party injury and death and the own damage claims.
However, the implementation of the new tariffs, which should have started on Tuesday, June 9, 2015, was swiftly opposed by car owners and commercial drivers who threatened to embark on a strike.
The leadership of the Ghana Road Transport Coordinating Council GTRCC revealed that drivers would form their own insurance companies.
They wondered why the insurance companies would exorbitantly increase the premiums at a time when they were required to pay for seatbelts and road worthiness, among others.
Protest by the drivers compelled the Insurance Commission to suspend the move and call for further consultation.
Minister’s Response
Deputy Finance Minister, Mona Quartey, told Joy Business she was happy with the feedback from the drivers about the increase in insurance premiums.
According to her, the premiums could have been increased gradually over a period of time.
‘We haven’t formally called for review but we [Ministry] have called the industry regulator and they will come to us. We will sit down and discuss how best to perhaps make this a little easier,’ she said.
The Minister said she was in agreement with the insurance bodies that the insurance premiums must be increased, adding ‘but how they go up is something that we will discuss to make it easier.’
By Cephas Larbi
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